Tue, Sep. 8, 12:58 PM
- Israeli lawmakers yesterday approved a framework agreement regulating how Noble Energy (NBL -0.2%) and its partners can develop two massive offshore gas fields, but the projects still cannot move forward because a critical vote to transfer the economy minister's authority on the matter to the full cabinet was not successful.
- NBL praised the Knesset vote and urged the government to quickly clear all remaining barriers to development.
- The negotiations took on a new urgency after Italian oil company Eni said last week it had discovered a “supergiant” gas field offshore Egypt that could undercut Israel’s plans to sell its gas to its energy-hungry neighbor.
Tue, Sep. 8, 8:07 AM
- Noble Energy (NYSE:NBL) +1.7% premarket rafter raising its Q3 sales volume outlook based on a stronger than expected performance in July and August.
- NBL says it now expects sales volume of 350K-370K boe/day, 10K boe/day higher at the midpoint than the previous range, driven mostly by enhanced well performance and infrastructure expansion in the DJ Basin in Colorado.
- NBL says it also is seeing strong production from assets in Texas, Marcellus Shale, Israel and Equatorial Guinea; natural gas sales in Israel set a record in August, as the Tamar field averaged more than 1B cf/day of natural gas.
- Says the addition of the Lucerne-2 plant has expanded total system natural gas processing capacity to 840M cf/day.
Thu, Sep. 3, 12:29 PM
- Noble Energy (NBL +1.3%) says it remains committed to the development of Israel's offshore natural gas fields for export, after Eni's (E +0.3%) recent discovery of the largest gas field in the Mediterranean that Israeli officials fear could threaten its deal with developers that was based on expectations of substantial gas exports to Egypt.
- The Eni discovery is seen as sparing Egypt Pres. Al Sisi the political liability of doing a major gas deal with Israel.
- Production of the Israeli fields already had been delayed by disagreements about regulation, pricing and profit-sharing, and NBL urges the government to "follow through on [the] approved framework without further delay."
- NBL CEO David Stover says the competition from Egypt could help spur Israeli regulators to approve the framework that would allow the company to move forward with an expansion of the Tamar gas field and the development of Leviathan, and says the region’s demand for natural gas, as well as demand from export markets in Europe and Asia, is substantial enough to support production from both gas fields.
- Israel's Leviathan field, found in 2010, had been considered the largest in the Mediterranean until the discovery in Egypt, and the smaller Tamar field was found in 2009.
Tue, Sep. 1, 8:21 AM
- Denbury Resources (NYSE:DNR) hires Chris Kendall as its new COO, effective Sept. 8, and will assume the role from President/CEO Phil Rykhoek, who has been serving in that capacity on an interim basis.
- Kendall is joining DNR from Noble Energy (NYSE:NBL), where he was senior VP for global operations and a member of NBL's executive management team; he had been with NBL since 2001.
Mon, Aug. 31, 12:27 PM
- Eni’s (E +2.6%) discovery of a “super giant” natural gas field off the Egyptian coast will help make the company’s cash flow position "much more robust" and "positively" affect its dividend, CEO Claudio Descalzi says.
- Eni says the deepwater deposit in the Zohr Prospect in the Shorouk block may hold 30T cf of gas; the CEO hopes Eni can begin producing gas "in a couple of years,” the development will be “low cost” since it is located near facilities it has in the area, and the company is open to selling a stake in the field.
- The huge find could help meet energy-starved Egypt's gas needs for decades and complicate Israel's plans to export gas to Egypt; companies including Noble Energy (NBL -2.3%) and Delek Group (OTCPK:DGRLY -9.6%), which are developing gas fields in Israel, have been pushing plans to export the fuel to Egypt, Jordan and the Palestinian territories.
Tue, Aug. 25, 7:05 PM
- Dividends of oil E&P companies such as Exxon Mobil (NYSE:XOM), Chevron (NYSE:CVX), Anadarko Petroleum (NYSE:APC) and Occidental Petroleum (NYSE:OXY) are “mostly safe" in the shaky commodity landscape despite Chesapeake Energy’s decision to suspend its payout, says Raymond James' Pavel Molchanov and his analyst team.
- Although the firm projects only one company - APC - out of 18 to fully cover the 2016 dividend payout out of cash flow at strip pricing, dividends likely will not be cut since "all the companies that have a healthy balance sheet today should still have a healthy balance sheet at the end of 2016, even if they maintain the current dividend."
- The only dividend payers with a current net debt/cap ratio above 50% are DNR and CRC - a red flag, but both companies’ dividend payouts represent quite small amounts of outlays relative to cash flow, the firm says, adding that the only companies whose leverage is likely to be lower at year-end 2016 than it was in Q2 2015 are HES and QEP.
- Among large-caps, the highest current leverage is at APC, at 45%, and NBL, at 38%, while the companies with the lowest current leverage are CVX, OXY and XOM, all at 15% or lower.
Mon, Aug. 24, 3:27 PM
- Chevron (CVX -5%) is upgraded to Neutral from Underperform with a $100 price target at BofA Merrill, which expects CVX’s net debt to stabilize with major projects beginning to contribute in 2017 and a drop in spending to maintenance levels.
- The firm says it has been concerned throughout the past year that CVX's cash burn would dilute equity value through peak spending at the same time that oil prices collapsed, but it no longer sees a risk, as CVX is discounting below strip prices but with a dividend.
- CVX requires sustained spending of $15B-$16B to hold production flat for an extended period,” BofA's Doug Leggate explains, adding that at $45-$50 oil, cash flow by 2017 would be closer to $29B so that the dividend is "more than covered" by cash flow in an ex-growth environment.
- ConocoPhillips (COP -6.2%) is the firm's top pick among the big oils after the stock has been hit hard, which the analyst thinks reflected unwarranted concerns regarding COP's dividend; at current strip prices, Leggate believes COP's upside is second only to Buy-rated Exxon Mobil (XOM -5.3%).
- However, the firm downgrades HollyFrontier (HFC -3.5%), Marathon Petroleum (MPC -7.2%) and Valero (VLO -4.7%) to Underperform and cuts Continental Resources (CLR -10.1%), Marathon Oil (MRO -8.4%), Noble Energy (NBL -5.4%) and Whiting Petroleum (WLL -8%) to Neutral.
Wed, Aug. 19, 11:18 AM
- It's a broad decline for stocks this morning, with the S&P 500, DJIA, and Nasdaq all lower by 1% or more. Leading the way down are the energy names (XLE -2.5%) after an unexpected jump in oil inventories has sent the price of black gold down to new bear market lows at $41.30 per barrel.
- Chevron (CVX -2.9%), ConocoPhillips (COP -3.8%), EOG Resources (EOG -4.3%), Apache (APA -4.1%), Hess (HES -3.6%), Marathon Oil (MRO -5.5%), Noble Energy (NBL -3.1%), Anadarko (APC -3.6%).
- ETFs: XLE, VDE, ERX, OIH, XOP, ERY, DIG, DUG, BGR, IYE, IEO, FENY, PXE, FIF, PXJ, NDP, RYE, FXN, DDG, DRIP, GUSH
Sun, Aug. 16, 11:34 AM
- Israel's cabinet has approved a regulatory framework that will pave the way for development of the Leviathan natural gas field.
- The plan will allow Texas-based Noble Energy (NYSE:NBL) and Israel's Delek Group (OTCPK:DGRLY) to keep ownership of the massive offshore deposit, but will require them to sell off other assets, including stakes in another large field called Tamar.
- Leviathan, with estimated reserves of 22T cf of gas, is slated to begin production in 2018 or 2019.
- Previously: Israel signs deal with Noble Energy, Delek to develop Leviathan gas field (Aug. 13 2015)
Thu, Aug. 13, 2:29 PM
- At least some E&P companies are still able to sell shares despite the oil price swoon, as Diamondback Energy (FANG -1.3%) raises $176M through a stock offering - its third this year.
- FANG has completed more follow-on stock sales than any other U.S. E&P firm this year, although at $623M it has not raised the most; Noble Energy (NBL +1.6%) and Whiting Petroleum (WLL -4.5%) each have sold more than $1B.
- Crude oil’s collapse has not stopped the sector raising more money so far in 2015 - $11.6B so far - than any entire year in at least two decades, which may indicate optimism about oil nearing a bottom and that at least some E&P companies are using capital more productively.
- If a FANG investor bought its three stock sales this year, weighted by the size of each, he actually would have gained 2%; while the shares of only 10 of 35 issues YTD are higher than the price at which they sold, the group as a whole has beaten the E&P sector average by almost eight percentage points this year, adjusted for size and offer date, WSJ's Liam Denning writes.
Thu, Aug. 13, 9:10 AM
- Noble Energy (NYSE:NBL) +1.9% premarket after Israel's government said it reached a deal that will pave the way for the development of the Leviathan natural gas field.
- The controversial deal initially revealed in June will allow NBL and Israel's Delek Group (OTCPK:DGRLY) to keep ownership of Leviathan but require the sale of other assets, including stakes in the Tamar deposit.
- The deal sets a price ceiling for gas sales to Israeli companies and commits the consortium to invest $1.5B into developing Leviathan over the next two years; the field contains ~22T cf of gas, which is expected to provide billions of dollars in revenue to Israel.
- PM Netanyahu earlier this week won crucial backing for the agreement from the central bank.
Mon, Aug. 10, 10:15 AM
- Bank of Israel Governor Karnit Flug backs a disputed government plan to develop the country's natural gas industry that would allow Noble Energy (NBL +1.5%) and Delek Group (OTCPK:DGRLY) to keep ownership of the Leviathan offshore field.
- Flug says would speed up development of Leviathan and other smaller fields, and would bring "more stable regulation of the natural gas economy," making it easier to progress with financing and development.
- The outline agreement lets NBL and Delek to keep Leviathan, with estimated reserves of 22T cf, but requires the companies to sell off other assets including stakes in the large Tamar deposit.
Mon, Aug. 3, 10:31 AM
- Noble Energy (NBL -2.2%) opens lower after reporting better than expected Q2 earnings but also a 47% Y/Y revenue decline and costs that are not falling as much as sales.
- While NBL's Q2 sales volumes rose 3.1% Y/Y to 299K boe/day, crude oil and condensate sales were cut in half to $483M, and natural gas revenue fell 28% Y/Y to $215M.
- NBL attributes the modest rise in Q2 total sales volume to the continued development of the DJ Basin and Marcellus shale plays, where combined production rose 28%.
- NBL raises its full-year sales volume forecast to 305K-320K boe/day from 300K-315K boe/day, and says it expects more than 15% annual production growth from assets recently acquired from Rosetta Resources, which includes 50K acres in the Eagle Ford Shale and 54K acres in the Permian.
- NBL says total organic capital spending in 2015 remains unchanged at $2.9B for legacy assets; Q2 costs fell 17% Y/Y and 13% Q/Q.
Mon, Aug. 3, 7:34 AM
Sun, Aug. 2, 5:30 PM
Wed, Jul. 22, 2:37 PM
- A reduction in non-OPEC production eventually will provide an opportunity for U.S. producers to get back in the game, Credit Suisse analyst Mark Lear says as he upgrades the oil and gas E&P sector to Overweight and changes ratings for several individual stocks.
- Lear sees a handful of names with limited downside at WTI prices of ~$60/bbl and “decent” upside with prices in the $70’s, and expects a better year for natural gas in 2016 as dropoffs in production and higher demand could lead to higher winter prices.
- "We may be early,” but Credit Suisse assumes coverage at Outperform on some E&P stocks: EOG, EPE, PXD, DNR, APC, DVN.
- Upgraded to Outperform from Neutral: HES, CXO, CRZO, NBL
- Upgraded to Neutral from Underperform: MUR.
- Assumed coverage at Neutral: APA, DNR
- Assumed at Underperform: SD, SWN
- Downgraded to Underperform from Neutral: REXX, CRK
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